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Brits blast off

The UK space industry's funding is a tiny fraction of Nasa's but, thanks to British boffins, it's taking a healthy chunk of the international market and making satellites so affordable you can buy one on a credit card.

by Emma Haslett

Published: 01 Jun 2011

Last Updated: 18 Nov 2015

There's nothing space age about Astrium's UK headquarters. To begin with, it's stuck next to a large branch of KwikFit on the A1072 just outside Stevenage. And with its tinted glass, cheesy palm trees and wipe-clean carpet, the lobby has overtones of a 1970s leisure centre about it.

Make no mistake: this is a site of national importance. Astrium, once a division of British Aerospace and now part of giant European aerospace joint-venture EADS, is the largest firm of its kind in Europe. It uses the facility to manufacture payloads and mechanical systems for its satellites. Through viewing windows, there are glimpses of scientists clad in hairnets and overshoes painstakingly tinkering with microchips. One room is dedicated entirely to the manufacture of what seems to be tinfoil but is in fact the extra-light heat and radiation-resistant foil the components on the majority of its finished satellites are wrapped in. All over, there's a hushed sense that Something Important Is Going On.

Astrium may be one of the UK's largest satellite manufacturers but it is by no means the only one. In fact, the British space industry is enjoying something of a moment. The US may still be the global leader when it comes to space with a 25% market share, but the UK is a significant player too. With only £265m of government subsidy (a teeny 0.44% of the US space budget) it has managed to build up 6% of the global space market.

And a glance across the pond suggests there is trouble afoot even there: crippled by its $14trn debt, the Obama administration has taken the unprecedented step of making cuts to the $60bn it ploughs into the industry annually, back-tracking on plans for a manned mission to Mars and retiring Nasa's flagship Space Shuttle programme after more than 20 years on the job.

By contrast, the UK's space sector is thriving: according to a survey by the new UK Space Agency, it is worth an estimated £7.5bn and employs 25,000 highly skilled workers, more than 70% of whom have at least one degree. And, for the past decade, the industry has been growing by 9% a year. In other words, there are signs that what the UK's space companies lack in size and clout they more than make up for in enterprise, innovation and commercial hardiness.

Of course, the UK remains a minnow in the field. After the US, the big players are China - which plans to have its own space station by 2020 - and Russia. But all three are in the game more for prestige and national glory than for commercial gain.

The UK's interests are decidedly more tangible. Although firms such as Virgin Galactic (based in the US) have stimulated a new interest in space flight, it is communications satellites and their applications - everything from broadcasting to GPS, telecoms and earth observation - that make up about 96% of the British space industry.

Satellites may lack glamour, but ever since the UK's first, Telstar, was propelled into orbit in 1962 to relay grainy TV images of Richard Dimbleby and Walter Cronkite across the Atlantic, they have been big business. There are now reckoned to be around 3,000 operational satellites, plus a further 5,000 defunct ones still whizzing around. They're a vital part of telecoms, broadcasting and navigation infrastructure and, as David Williams, the CEO of UK satellite broadband firm Avanti, points out: 'It's axiomatic that the world's demand for data shows almost no sign of abating as far out into the future as you care to look.'

You won't find a better example of enterprising British spirit than Avanti. The firm was launched in 2007 by Davids Bestwick and Williams, an engineer and a banker respectively, in order to fill the coverage gaps in more remote areas left by terrestrial broadband.

But with the average entry-level comms satellite costing a cool £300,000, not to mention taking years to design and build, their start-up required investors to be forward-looking and risk-averse. Williams says the company has been through 'just about every stage of funding' - from the typical round of friends-and-family angel investment early on to floating on AIM.

And it has paid off: Avanti's first satellite, Hylas-1, began broadcasting in April, giving the company an instant customer base of 100 million households in Europe. Avanti's second satellite will launch halfway through next year, and the design of Hylas-3 has just been put out to tender. The business is gaining altitude fast - and there are relatively few competitors out there to bring it down to earth.

As well as Avanti, another example of the renowned British talent for technical innovation is Clyde Space, the tiny Scottish start-up that is a world leader in CubeSats, the next generation of satellites. And there's Surrey Satellite Technology, the spin-off from the University of Surrey that established 'off the shelf' satellites in the 1970s and was sold to Astrium for an estimated £50m in 2008. Both were started by, as Williams puts it, 'typical British engineers tinkering away in their garden sheds'. Both were pioneers in their fields.

In fact, says Richard Peckham, business development director at Astrium and chairman of UK Space, the sector's trade body, innovation is central to the strength of the British space industry: there is a closeness to universities that other countries don't have. The latest technological breakthroughs go from lab to market more quickly as a result. 'It's one of the areas that makes our space industry a little bit different,' he says.

But there's a downside to that innovative streak. British engineers may be full of good ideas, but when it comes to finding a route to market, they fail, badly. Alan Bond, of Reaction Engines, says it took an investor willing to sit down, comb through the figures and come up with a list of do's and don'ts before his firm was in any shape to hit the commercial stage. They may have been a group of highly innovative engineers, but business nous escaped them. 'I dread to think how much truly innovative material must have been lost in Britain because people don't have the right skills to bring their ideas to market,' he says.

Craig Clark, founder of Glasgow-based Clyde Space, believes it is a wider problem. 'You get a lot of clever people coming out of schools, thinking, what do I do? They could go into engineering and earn a decent salary, or they could be a lawyer and make a lot of money.' It doesn't exactly come as a surprise that those who are good at business go into business, but Clark says: 'It's the engineers who are actually bringing in the cash to the country.'

Avanti's Williams adds that businesses themselves can help to solve the problem: his firm is funding its own programme, providing bursaries for five students each year with low-income backgrounds to study for degrees relating to space. 'It's partly because we give some consideration to the need for business to develop better social mobility - but it's also because it's a cost-effective way of finding and nurturing talent. I honestly believe it's the only way to get people with the skills we need.'

Is there anything a cash-strapped Government can do to nurture the sector? In the Budget, the Chancellor earmarked £10m for space. It's not much but, given the state of the public finances, it's significant. The funds will, in part, go towards a new International Space Innovation Centre at Harwell in Oxfordshire, an incubator for space businesses designed to 'get academia, small companies and big companies working together'.

The other change the Government has made that will help space businesses is an update of the 1986 Outer Space Act. At the moment, the act includes draconian measures that place the responsibility for any collision involving a UK-registered spacecraft on the company that owns it. That has sent insurance policies into orbit. Clark points out: 'At the moment, if a satellite costs £1,000, we'd have to pay £1m in insurance. This will finally make it cost-effective to register a satellite in the UK.'

So perhaps the UK space sector demonstrates that industries - even capital-intensive manufacturing ones - can prosper with minimal Government support. That's a valuable lesson that we could all benefit from, as the economy continues to struggle its way back to stability.

REACTION ENGINES: SKYLON

Holed up in a science park a few miles outside Oxford is the company that just might bring space travel to the masses. Not some namby-pamby, edge-of-the-atmosphere, experience-zero-gravity-for-a-few-minutes-then-buy-a-keyring version of space travel, either: this is the kind that both Stanley Kubrick and Arthur C Clarke thought would already have become commonplace by now.

The company behind it is called Reaction Engines, led by engineer Alan Bond (above), a veteran of both the UK's swansong rocket programme, Blue Streak, and of the stillborn 1980s HOTOL space plane project. The problem that has kept space travel - and transport - expensive, and thus outside the realm of the everyday, says Bond, is propulsion systems.

At the moment, sending a vehicle into space involves strapping it to a rocket, which then drops off. Not only is it an expensive way to do things, it's complex too. 'You need an army to put it together, there's a massive amount of paperwork, and when you do launch it, about one in 50 ends up in the nearest ocean,' says Bond.

Reaction's solution combines a rocket propulsion system with a jet engine. That means its plane - the sleek, black, eerily elegant Skylon - is capable of taking off and landing horizontally like an ordinary jet, but can then achieve the sort of speeds needed for it to leave the atmosphere and enter orbit.

It sounds like the stuff of big-budget movies, but Skylon is often cited as the only realistic replacement for Nasa's space shuttles, whose final mission blasts off later this month. The downside, though, is that it will cost as much as £7.5bn to develop. If you're Airbus and designing the A380, that sort of development cost is par for the course. But if you're a cash-strapped start-up, it's less viable.

But investment is trickling in. The lion's share has been private funding. 'That first bit of money gives you confidence you're not trying to design a flying saucer,' says Bond.

And while it was slow coming at first, over the past few years, investment has become easier to get hold of. 'The company has changed from a bunch of us trying to keep the idea alive to 50 people trying to realise it in living metal. Quite an achievement.'

CLYDE SPACE: CUBESATS

'You can tell from my accent that I'm not from Surrey,' says Craig Clark (right), in his distinct Glaswegian twang. Clark is the man behind satellite manufacturer Clyde Space and is trying to explain why he chose to jack in his job at Surrey Satellite Technology, one of the country's largest manufacturers, and move to Glasgow to set up a business. As 92% of the UK's space industry is located in the south-east, it was a bold move.

But, despite its location, in the six years since, Clyde Space has become a world leader in CubeSats, the next generation of satellites. Measuring a tiny 10cm square, and weighing just 1kg, CubeSats are designed to be as cost-effective as possible. They're also the first 'standardised' satellites. 'The satellite's size is standard, its body is standard, there are even standard systems you can buy to put on it,' says Clark. And that helps to cut down on 'non-recurring costs' such as design and development. As a result, a CubeSat can be yours for less than £2,000. Which, as Clark points out, 'means you can put it on your credit card'.

Clyde Space's involvement in the technology from the off means the firm counts Nasa, the German space agency, the Canadian space agency and even the US Air Force among its customers.

Its overwhelming success has meant that Clyde Space was the first name on the list when the UK Space Agency launched its 'UKube' project, a competition to design and build a CubeSat and get it into space on a shoestring budget. The competition cemented a funding package worth £1m for the firm which, says Clark, is 'a great opportunity to help us get established'.

But Clark says although Clyde Space is one of the UK space industry's success stories, things could change at any moment. 'There's lots of capability in the UK and there's lots of opportunity to expand from that. Six years ago, we didn't exist. Ten years from now, things are going to look very different again.'